# In the matter of Agri-Best India Limited CP (IB) No.144-Chd-Hry-2018

> NCLT judgment dated 2019-02-20. Citation: TCN-2019-NCLT-04746. Hero Fincorp Limited, a financial creditor, filed a petition under Section 7 of the Insolvency…

- **Court:** NCLT
- **Order date:** 20 Feb 2019
- **Citation:** TCN-2019-NCLT-04746
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/agri-best-india-limited-cp-ib-no144-chd-hry-2018-7683d9c6

## Summary

### Background

Hero Fincorp Limited, a financial creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Agri Best India Limited, the corporate debtor, due to a default in payment. The financial assistance was provided for working capital requirements by discounting sales bills of Britannia Industries Ltd. and Parle Biscuits Pvt. Ltd. Initially, ₹2.5 Crores was sanctioned, later enhanced to ₹7.5 Crores. The corporate debtor allegedly defaulted on payments, leading to the petition.

## Facts

Hero Fincorp Limited (financial creditor) filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Agri Best India Limited (corporate debtor). The financial creditor sanctioned ₹2.5 Crores to the corporate debtor, later enhanced to ₹7.5 Crores, for working capital through bill discounting of sales to Britannia Industries Ltd. and Parle Biscuits Pvt. Ltd. A Master Facilities Agreement and Supplementary Agreement were executed. The financial creditor claimed a default of ₹6,89,00,745.37. A loan recall notice was issued on 19.04.2017. The corporate debtor, represented by Mr. Gopal Sharma, claimed non-receipt of bill discounting amounts but failed to provide supporting details. The

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, for initiation …

**Ratio:** Section 7(5) of the Insolvency and Bankruptcy Code, 2016, provides for the admission of

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**Reasoning:** The Tribunal considered the arguments of both the financial creditor and the corporate

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**Interpretation:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a

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**Application:** The Tribunal found that the financial creditor had established a default, the

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## Parties

- **Judges:** R.P.Nag…; Pradeep R.…
- **Appellants:** Hero FinCorp…
- **Respondents:** Agri Best India…

## Timeline

- **2015-07-23 — Sanction…**: Financial assistance of…
- **2015-08-11 — Master Facility…**: Master Facility Agreement executed between…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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